SC rules out AGR definition change: What does it mean for telecom firms?

The 14-year-old case had mobile operators locked in a legal battle with the government over the definition of AGR, or adjusted gross revenue. While the telecom providers insisted that AGR only included revenue from core operations, Department of Telecom (DoT) maintained that AGR also included revenue from operations, other than core ones.

AGR assumes significance because it is the basis on which the DoT calculates levies payable by operators.

The Supreme Court on Thursday rejected definition of AGR given by the telecom firms. A three-judge bench headed by Justice Arun Mishra said the telecom service providers would have to pay now fines and penalties on the fees not paid.

The apex court allowed the Centre to recover over Rs 92,000 crore from the already financially-stressed telecom industry. Banks are bracing for additional stress on their exposure to telecom service providers following the Supreme Court’s ruling.

What does it mean for the incumbent telecom service providers? Listen to the podcast to find out